The initiative of taking responsibility by corporations in order to bring positive change in society and the environment is known as corporate social responsibility. This term implies the extra working and efforts of corporations in order to uplift the society and the environment. Big organizations have a huge power in both society and the national economy. They possess a huge number of assets and have billions of dollars for social investment and programs. Today, many large companies engage in social responsibility and investing their money and time in environmental sustainability programs, renewable energy projects and many other social welfare projects benefit their stakeholders and society at large. (Leonard & McAdam, 2003)
There are a number of advantages when managers and corporations act in a socially responsible manner. First, stakeholders’ gets benefits directly as the cost of these projects are borne by organizations rather than government. Secondly, if all organizations in society become socially responsible then living standards and quality of life will be higher. According to many researchers, if all companies adopt employee caring culture and work for promoting the interest of employees then it will have an impact on the whole society. Moreover, being socially responsible is a good thing to do and it is noted that organizations that act as socially responsible have seen increases in their business and rise in their profit also. (Holme & Watts, 1999)
If we see in the long run, organizations that act socially responsibly give benefits to both stakeholder as well as stockholders. This means that organizations that are more socially responsible are less risky investment, more profitable, better reputation in the market and have a loyal and committed workforce. Moreover, companies engaged in social responsibility are sought out by societies and they offer many incentives to such organizations like reduction in tax, free utility services for their plants etc. (McWilliams & Seigal, 2001)
References
Leonard, D., & McAdam, R. (2003). Corporate social responsibility. ASQ, Retrieved from
http://alexandrow.pdforms.texas-quality.org/SiteImages/125/Reference Library/Social Responsibility - Leonard.pdf
McWilliams, A., & Seigal, D. (2001). Corporate social responsibility: A theory of the firm
perspective.Academy of Management Review, 26(1), 117-127. Retrieved from
http://amr.aom.org/content/26/1/117.full.pdf+html
Holme, R., & Watts, P. (1999). Corporate social responsibility. Geneva: World Business Council
for Sustainable Development, Retrieved from http://www.megamindservices.in/pdfs/CORPORATE SOCIAL RESPONSIBILITY.pdf
